Accounting for Managers

411. A credit balance of £200 on the cash columns of the cash book would mean:

  1. We have £200 cash in hand
  2. Someone has stolen £200 cash
  3. We have spent £200 more than we have received
  4. The bookkeeper has made a mistake
Correct answer: (D)
The bookkeeper has made a mistake

412. A cash discount is best described as a reduction in the sum to be paid:

  1. If payment is made by cash, not cheque
  2. If purchases are made for cash, not on credit
  3. If payment is made either by cash or cheque
  4. If payment is made within a previously agreed period
Correct answer: (D)
If payment is made within a previously agreed period

413. An alternative name for a Sales Journal is:

  1. Sales Day Book
  2. Sales Ledger
  3. Sales Invoice
  4. Daily Sales
Correct answer: (A)
Sales Day Book

414. The total of the Returns Outwards Journal is transferred to:

  1. The debit side of the Returns Outwards Account
  2. The credit side of the Returns Outwards Book
  3. The credit side of the Returns Outwards Account
  4. The debit side of the Purchases Returns Book
Correct answer: (C)
The credit side of the Returns Outwards Account

415. In the trial balance the balance on the Provision for Depreciation Account is:

  1. Not shown, as it is part of depreciation
  2. Sometimes shown as a credit, sometimes as a debit
  3. Shown as a credit item
  4. Shown as a debit item
Correct answer: (C)
Shown as a credit item

416. A debit balance brought down on a Packing Materials Account means:

  1. We have a stock of packing materials unused
  2. We are owed for packing materials
  3. We have lost money on packing materials
  4. We owe for packing materials
Correct answer: (A)
We have a stock of packing materials unused

417. Which of these best describes a balance sheet?

  1. A statement of assets
  2. A listing of balances
  3. An account proving the books balance
  4. A record of closing entries
Correct answer: (B)
A listing of balances

418. ______________ the transactions is known as Book Keeping.

  1. Classifyi
  2. Recordi
  3. Summarisi
  4. None of the
Correct answer: (B)
Recordi

419. Goodwill account is related to ______________

  1. Nominal account
  2. Personal account
  3. Real account
  4. Tangible account
Correct answer: (C)
Real account

420. The credit balance of bank account indicates ______________

  1. amount payable by the bank
  2. amount payable to the bank
  3. cash at bank
  4. loan from bank
Correct answer: (B)
amount payable to the bank
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